PAKISTAN MAY ASK IMF FOR AID AFTER BEING REFUSED BY CHINA

http://timesofindia.indiatimes.com/Intl_Business/Pak_may_ask_IMF_for_aid_after_being_refused_by_China_Report/articleshow/3614511.cms

NEW YORK: Refusal by Islamabad's staunch ally China to provide cash to shore up its economy has left Pakistan President Asif Ali Zardari with unpopul
ar prospect of having to ask the International Monetary Fund (IMF) for help, a media report said on Sunday.

Zardari, who has just returned from a visit to China, had hoped that Beijing would provide between USD 1.5 billion and USD 3 billion in much needed cash, the report said, adding that China put cold water on his expectations.

Islamabad, the New York Times said, was seeking aid from China as it faces the possibility of defaulting on its current account payments.



With the major donors focused on financial crisis, the report said, Pakistan's argument that it needs the money to counteract terrorist threat also does not cut ice.

The infusion of cash, the paper said, would have helped with payments for oil and food as currency reserves dwindle.

Economic hardship has been mounting across Pakistan for several months. Electricity shortages have become so dire that even middle-class families in big cities have to ration supply, with power cuts for 12 of every 24 hours, with one hour on, and one hour off, the report said.

Food prices have soared, making some basics, even flour, too expensive for the poorest to afford. No large-scale riots have occurred, but concern is mounting that such protests are not far off.

With the United States and other nations preoccupied with financial crisis, and Saudi Arabia, another traditional ally, refusing to offer concessions on oil, China was seen as the last port of call before the IMF, the New York Times report said, adding accepting a rescue package from the fund would be seen as humiliating for Zardari's government.